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3) LL’s NEED more rent. I have a family member who bought a rental at the height of the market. (I all but held him a knife point not to) The rent he gets was about $750 cash negative. Now he can afford it no prob, but doesnt want to. So with every renewal he ups it $50-$100 or more, whatever the market will bear, to get to breaking even. He can afford it, just think about all those that in all reality, cant. Talk about motivation to increase rents.
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I can attest to that. In my complex, the going rate is about $1,600/month but you would find some LLs advertise for $2,000 on craigslist.
My theory is that rental market is very local. LL figured out that every greedy LL united to hike the price and eventually every properties in the neighbourhood will be offered at $2,000. Somebody got to start this thing because all LL are bleeding to a slow death.
